NYULMC Hospital for Joint Diseases NYU Langone Medical Center’s TJA BPCI Experience: Lessons in How to Maximize Value Richard Iorio, MD Chief of Adult Reconstruction William and Susan Jaffe Professor of Orthopaedic Surgery Department of Orthopaedic Surgery NYU Langone Medical Center Hospital for Joint Diseases
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NYULMC Hospital for Joint Diseases - Ortho Service Line · NYULMC Hospital for Joint Diseases NYU Langone Medical Center’s TJA BPCI Experience: Lessons in How to Maximize Value
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NYULMC Hospital for Joint Diseases
NYU Langone Medical Center’s TJA BPCI Experience: Lessons in How to Maximize Value
Richard Iorio, MDChief of Adult ReconstructionWilliam and Susan Jaffe Professor of Orthopaedic SurgeryDepartment of Orthopaedic SurgeryNYU Langone Medical CenterHospital for Joint Diseases
Disclosures
• Consultant for Medtronic and DJO Surgical
• Product liability consultant for DePuy Orthopaedics
• Institutional Research Support: Pacira, Orthofix, Vericel, Orthosensor,
Bioventus, Ferring
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The Future is Here
Value Based Purchasing (VBP)
•The goal of value based purchasing (VBP) is to transform Medicare
from a passive payer of claims to an active purchaser of care.
• In the past health care organizations were profitable as long as they
processed patients.
•For decades, health care systems have responded to incentives that
rewarded volume regardless of quality.
•VBP is an effort to change the focus of how care is paid for: in essence,
the government wants value – not just quantity – for the money that it
spends.
•Episode of care delivery such as bundled payment offers a framework
to measure the amount of value brought to a diagnosis
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Bundled Payment Initiative
Background
•NYULMC HJD is a large, tertiary, academic medical center with a hybrid
compensation system which implemented a Model 2 bundled payment
initiative for Total Joint Replacement, Spinal Fusion and Cardiac Valve
Surgery in January of 2013.
• In April of 2016, CJR, a modification of Model 2 BPCI, was instituted in
67 MSA’s by CMS
• In January of 2017, quality and financial metrics will begin collection for
MIPS under MACRA which will regulate CMS reimbursement for the
foreseeable future as a replacement for SGR adjustments
• In January of 2018, voluntary participation in BPCI and CJR will be
reopened to allow for advanced APM fulfillment of the requirements of
MIPS and MACRA
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The Future is Here
Differences between BPCI and CJR
•All episodes will be 90 days of care (Model 2 BPCI)
•No third party purveyors or EI, hospitals only
•Historical and Regional data is used to set target price in years 1-3
•Regional data only will be used for year 4 and 5 in CJR
•Quality metric reporting and PRO measurement will be rewarded
•Hospital Quality Standards will be used to determine eligibility for
reconciliation: RSCR, HCAHPS, and PROMs
•Reconciliation will be awarded with a composite score methodology of
quality measures and financial performance
•No physician risk throughout the program, No hospital risk in year 1
•Stop loss limits, 5% above target in year 2, 10% in 3, and 20% in years 4-5
•Gains limited to 20% above target price x number of episodes
•Risk stratified episode threshold for hip fractures
•Relief for difficult diagnoses like HCV, HIV and Hemophilia
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CJR
It’s good to be bad…until it’s not
•CMS recognizes that hospitals may have limited ability to moderate spending
for certain high cost cases. Therefore in setting target prices for both MS-DRGs,
CMS proposes to set a high outlier limit at two standard deviations above the
regional average episode cost. Individual episode costs that exceed the high
outlier limit would be truncated to that limit so hospitals’ downside risk would be
limited.
•CMS does not propose to set target prices based solely on historical hospital-
specific data but rather intends to use a blend of historical hospital-specific and
regional-historical claim data. CMS proposes to transition to using regional only
data to set targets by PY 4. CMS asserts this approach will afford early and
continuing incentives for both efficient and less efficient hospitals to furnish high
quality, efficient care in all years of the model.
•CMS recognizes the need for more physician involvement and will rectify this in
January 2018 with the ability of physicians to take more risk in both models
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The Future is Here
There will be winners and losers within the CJR demonstration project
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Years 1 and 2 Year 3 Years 4 and 5
100%
Regional2/3
Regional
1/3
Hospital1/3
Regional2/3
Hospital
Target price based on hospital (historical) and regional pricing
Bundled Payment Initiative
Background of BPCI
•The episode of care included the inpatient and post-acute care and all
costs through 90 days following discharge. The patient does not
receive financial incentives. CMS requires quality measure reporting. A
provider’s participation may be terminated by CMS if quality decreases
or if CMS identifies a significant concern.
•All unilateral, primary TKA and THA were included. Revisions and
bilateral TJA were excluded. DRG’s 469 and 470 were included and
payment was increased for DRG 469 due to the increased
comorbidities. The reference years for cost comparison were 2009-12.
•Clinical care coordination among all providers, evidence based clinical
pathway implementation, and standardization of post discharge care
were critical to the success of the program.
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What is Included in the Target Price?
Home Health
Agencies
Outpatient
Therapy Services
Skilled Nursing
Facilities & LTACH
Inpatient Rehab
Hospital
Surgeon
Physician Visits
(surgeon and other)
Any services during the 90-Day
Post-Acute Period
such as…
Consulting
Physicians
Readmissions
(to NYU or others)
DME
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Part B Drugs Outpatient Services
Lab Services
Anesthesiologist
Any
services
during the
Acute Stay
such as…
Any services
72 hours
prior to
Admission
such as…
ED Visits
Physician Visits
(surgeon and other)
PAT
Days 91-120
CMS will be
monitoring the period
immediately following
to ensure that
services are not
being shifted outside
the bundle.
NYULMC will be
financially
responsible if such
behavior is observed
and may be removed
from the program.
Avg Medicare Payment1
DRG DRG Description Inpatient Only2 90D Bundle3
469 MAJOR JOINT REPLACEMENT W MCC $16,303 $54,233
470 MAJOR JOINT REPLACEMENT W/O MCC $12,446 $35,565
1Data is based on FY 2009-12 Medicare claims. CMS will be carrying rates forward to 2013 for the Episodes of Care Initiative.2Inpatient payment includes patient deductible/coinsurance amounts, and excludes IME, DSH, Capital, and GDME payments.390D Bundle includes Medicare readmissions exclusions and Part B services exclusions, updated as of January 9th, 2013
2009 Medicare Payments - Inpatient Stay and 90 Day BundlePrimary Joint Replacement (MS-DRGs 469-470)
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Any patient having surgery at pilot
hospital for one of the MS-DRGs is
by default a part of the bundle;
It is not physician-specific
How Does Retrospective Bundling Work?
Claim from hospital
triggers a bundle
Patient is flagged by
CMS
CMS pays all providers
as normal
All providers bill Medicare
as normal
Retrospectively the sum
of claims is reconciled
against the target price
If it is LOWER than the target,
the awardee will receive a check
for the difference
If it is HIGHER than the target, the
awardee has to repay CMS
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12All post-acute Medicare costs incurred within the 90d bundle are categorized by the initial post-acute setting
(i.e., includes readmissions and other levels of care following the initial setting)
Relative Cost of 90 day Episodes of
Care by Post-Acute Setting
3-Yr Baseline Period
Approaches to Change
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Increase Alignment
Clinical Management
Technology
Clinician Behavior
Reporting and Monitoring
•Bundled Payment Weekly Dashboard – example of physician